Who will pay for the FC Cincinnati soccer stadium?

Major League Soccer has been called everything from the future of American pro sports to a Ponzi scheme.
Which label fits? That's an important question for Greater Cincinnati as the owners of Futbol Club Cincinnati shake the trees on both sides of t
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FC Cincinnati thanks the crowd after the 4-2 win against the New York Red Bulls II and FC Cincinnati, Saturday, Sept. 16, 2017, at Nippert Stadium in Cincinnati. FC Cincinnati won 4-2.(Photo: The Enquirer/Kareem Elgazzar)Buy Photo

FC Cincinnati General Manager Jeff Berding said the new 25,000-seat stadium would cost $250 million when he broke down the numbers during a press conference Thursday. The cost was initially set at $200 million, but record attendance at games prompted the team to want more seats.

The good news: the team is putting in the first $150 million for the stadium on top of $150 million for a Major League Soccer license.

The bad news: They need another $100 million from taxpayers.

Berding said MLS soccer is a "break-even" proposition, so getting any private investment is challenging.

Hamilton County voters agreed to build stadiums in the early 2000s for The Reds and The Bengals, which are funded with a half-cent sales tax, a funding scheme widely criticized for it ongoing costs tied to lease agreements.

"I understand that this has the word 'stadium' in it," Berding said. "And this community is somewhat scarred by that word."

Berding, a former city councilman who championed the current stadium tax, said he's learned his lesson. A sales tax is off the table, he said, and residents will not foot the bill for future improvement costs.

So what will FC Cincinnati ask of the city? Where will the money come from? There are a few options.

A special project TIF district

Berding mentioned tax incremental financing Thursday, but declined to reveal any details. Using this system, the city borrows money against the future property tax revenue of a property.

In this case, FC Cincinnati would eventually pay back the loans through their property taxes or taxpayers would have to absorb the costs.

It's unclear what the tax bill on the stadium would be, but Hamilton County Auditor data suggests adding a $250 million building to an existing property in Oakley Station would cost the owner about $8 million a year before any incentives. In this example, a 15-year TIF district could be worth $120 million.

Oakley also has an existing neighborhood TIF District which would open more funds from other property owners, but the Oakley Station area falls just outside of it.

Admission tax

There is a 3 percent on tickets to Bengals, Reds, Music Hall and other entertainment events. It can be increased to 5 percent, but would require city council and voter support to hike it.

"Jock Tax"

The city levies a 2.1 percent earnings tax on visiting athletes, musicians and other professional entertainers bringing in about $1 million a year.

This city could also offer payroll tax abatements or other property tax breaks to FC Cincinnati as well. Berding suggested the Port Authority could be a potential owner or "financial conduit" for the stadium.

What's next

With an MLS-imposed deadline of mid-December, Berding is under pressure to close the deal. He said he hopes to announce a completed stadium financing plan sometime next week.

Two of the other four cities hoping to join the MLS, Nashville and Sacramento, have already finished their stadium plans.

Berding insists this is the city's best chance to have an MLS team in the Queen City. Right now, Cincinnati is "the most proven market," he said. If an MLS bid is delayed a year others cities could catch up.